The electric drivetrain group Saietta Group (SED ) has taken on a manufacturing facility in Sunderland in the UK through a number of new agreements with ZF Automotive UK, by acquiring all of the group’s machinery and IT equipment for a consideration of £1.1 million.
Under the terms of the agreements, Saietta will take over the company’s lease of an 86,000 square feet electric motor manufacturing facility in Sunderland with immediate effect. This is expected to result in annual rent of £0.440m increasing to £0.615m as of 1 January 2023.
Saietta expects the agreements with ZF Automotive UK Limited ("ZF") to enable the group to meet its stated objective of establishing a UK pilot production facility, with capacity to produce 100,000 units per annum, significantly ahead of its target and budget at the time of its IPO.
At the time of its IPO in July 2021, Saietta stated that around £10 million of the proceeds raised were to be used for the development of a greenfield UK pilot production facility, with a capacity of around 100,000 units per year, within three years from completion of the IPO.
In addition, Saietta said its Directors believe this will happen at an overall cost significantly lower than that envisaged by the Company's original IPO proceeds for a greenfield site.
‘Having an on-site manufacturing capacity will be crucial in ensuring that Saietta maintains its product skill and knowledge from concept to production and, the Directors believe, should help to secure material contracts both in the near future and longer-term,’ Saietta noted.
The Sunderland Factory is a specialised automotive electric motor manufacturing facility of 86,000 square feet with a history of manufacturing over 20 million electric motors for a range of automotive applications. The factory has been producing electric motors for 23 years.
Saietta Group explained that it intends to use the facility to manufacture its heavy commercial vehicle drivetrains which were previously manufactured in China as well as to scale up the production of its AFT motors for its European marine subsidiary "Propel" and other customers.
Initially, the factory will be used to produce electric marine motors and the e-Axle product line that was acquired as part of the e-Traction acquisition in November 2021, which gave the Company access to the heavy goods vehicle and commercial vehicle markets, it explained.
Commenting, Wicher (Vic) Kist, Chief Executive of Saietta, told investors: "This is a landmark achievement for Saietta providing us with a UK pilot production facility more than two years ahead of schedule and considerably within the originally anticipated budget. In addition to the lease on the large factory in Sunderland, we are acquiring an automotive production line which has demonstrated over 20 years of operations producing electric motors. We will also be able to re-employ a proven, skilled workforce, preserving valuable jobs for the region.”
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